It is a fact that Social Networks play a key role in job search efforts. This is even more the case in Developing countries, where over 50% of individuals in job search report to find a job through Social Networks. This thus points to a situation where complementary knowledge among job searchers is quite important when it comes to find a job, start a search or just get informed about what the chances for a specific position might be.
This paper hence sets itself to investigate what the effect of Active Labor Market Policies might be in the process of knowledge and information sharing among job search peers. Using data from a field experiment in Addis Ababa, Ethiopia, researchers find that these policies have a negative effect on the information sharing act between individuals treated by such a policy and those untreated. Furthermore, they also find that partners of treated individuals reduce their job-search efforts as well. This therefore indicates that a policy intervention that does not treat all can potentially create inequalities that reduce the strength of social networks and hence perhaps social capital, while potentially leading to a reduction of the job search of partners too. Read the detailed Working Paper here.
